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Articles

The Professional Advisory

  1. Is it Time to Move?
  2. Staging A Dental Practice
  3. The High Cost of Dying
  4. Deal-Busters
  5. Patients - Attract and Retain
  6. Should I Stay or Should I Go?
  7. Is There a Buyer for Every Practice?
  8. Good, Better, Best - The Market has Spoken
  9. Smooth-Sale-ing
  10. Buying Time
  11. Patients, Patience, Patients
  12. A Real Patient
  13. Why Do a Practice Valuation? I'm not Selling
  14. Irrational Exuberance or The New Normal?
  15. Do dental equipment and dental technology affect a practice value?
  16. Finding and Being a Mentor
  17. Bigger is Better
  18. Daves Top Ten List for Buyers (Vendors should read this too!)
  19. How Well Do You Know Your Practice?
  20. Dave
  21. What will happen to dental practice Values in the next 10 years?
  22. Your Premises Lease is an Important Asset
  23. What are Associates Thinking?
  24. There is Life Outside the GTA
  25. When Is the Right Time to Sell My Dental Practice?
  26. Mergers are a Viable Option
  27. Is Your Associate an Asset or a Liability?
  28. Has your Practice Facility Kept Up With Your Billings?
  29. The 100 per cent of Gross Myth
  30. The Past, The Present and The Future
  31. Caveat Emptor
  32. Overpaid Long Term Staff
  33. Selling your Practice in Stages
  34. A Potential Pitfall of Selling Shares
  35. Value in Your Practice Through Balance
  36. Only Trusted Staff Can Defraud You
  37. To Own or Not to Own Practice Real Estate? That is the Question.
  38. Coping With A Large Patient Base
  39. Successful Dental Practice Transitions
  40. Taking Care of Business
  41. The Investing Dentist Phenomenon
  42. Two areas to focus upon that could negatively impact the value of your practice
  43. Organize your Debt in Order to Sell your Practice
  44. Having a Better Team
  45. How Do I Prepare My Practice For Sale
  46. How Do I Prepare My Practice For Sale? Part 3
  47. How Do I Prepare My Practice For Sale? Part 2
  48. How Do I Prepare My Practice For Sale? Part 1
  49. Advice to My Son or Daughter Graduating from Dental School
  50. Transition - What to Expect
  51. Discussion on Digital X-Rays
  52. Partnerships and Shotguns
  53. Strategic Planning - How to Get Started
  54. Calling All Vendors - Practices have Gone Up in Value
  55. Purchasers: Expect to Pay More for a Practice because of Lower Professional Corporation Tax Rates
  56. Matrimonial Practice Valuations
  57. Purchaser's Guide to Affording a Practice
  58. Location Improvements Throughout Your Career
  59. Small Practice Valuations
  60. Partnerships – The Best and The Worst
  61. Changing Location When the Opportunity Comes Along
  62. Visual Presentation of Your Practice
  63. Presentation of Charts
  64. Your Premises Lease Can Be Your Worst Enemy
  65. How to Select an Appraiser for Your Practice
  66. How Are Your Billing Ratios?
  67. It Pays to Invest in Your Tangible Assets
  68. The Importance of Separate Financial Statements
  69. Five Time Frame Levels to Sell a Practice
  70. 12 Suggestions to Safeguard Computer Data
  71. How to Buy a Visible Practice
  72. Why is there a shortage of good practices today?
  73. The Importance of Equipment in the Purchase of a Practice
  74. The Balanced Practice
  75. Will My Practice Be Saleable in The Future?
  76. Buyer Be Aware
  77. Excess Profit - The Second Key
  78. Patients and Profits are the Keys
  79. Plan Ahead

Volume 7: The Importance of Equipment in the Purchase of a Practice

Download the PDF version now!

It’s nice to have newer equipment when you purchase a practice but don’t let older equipment turn you off when considering an otherwise great practice. Equipment that’s 20-years-old won’t have a long life without constant repairs so consider the cost of revamping the equipment and/or the leaseholds when borrowing to purchase a practice. The value of the practice should be reduced because of the expected cost of replacing old capital assets. This comes back to having a good patient base to fund the new capital projects.

There are actually several advantages to having old equipment:

  • You can replace the capital equipment with brands you prefer.
  • You can purchase the practice with a lower capital expenditure.
  • You can lay out the practice in a more contemporary design.
  • You can pick the time frame for replacement (remember the patients are used to the old layout and equipment)
  • You can focus first on new x-rays and sterilizers.
  • Often the vendor would like to keep using the old equipment during transition.
  • Left or right handedness is not an issue with old equipment as it can be changed with minimal loss.

Cost of computerization

Non-computerized practices generally should be computerized in today’s market. The cost of computerization is low enough for virtually all practices. Computers are a labour-saving purchase which will pay for themselves and give you reports to better manage the practice.

Computer monitors that are on the front desk appear to be more up-todate if they are the TFT flat screens which now cost only $500 to $600. TFT flat screens are also easier on your staff’s eyes if they are on the computer for much of the day.

Filing systems

Many practices have suspended files on plastic strips that are three or four wide in a drawer. The drawers are generally 18” deep but provision must be made for 36” when the drawer is pulled open. However, there are advantages to using a system of 8 ½” by 11” file folders with an alphabetic colour code. These file folders take up less space and the colour coding allows staff to see misfiled patients more easily. There are a number of suppliers with a variety of prices. This new system is also impressive to show the extensive number of patients that have confidence in you as a dentist. Much of dentistry is the perception of the patient.

In summary, think of older equipment as a potential benefit rather than a drawback when considering a practice. Capital expenditures for computer equipment, meanwhile, should be viewed with regard to payback and efficiency. Finally, filing systems are an important component of your practice.

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